Silver prices remain under pressure as XAG/USD struggles to hold above the $32.00 mark, with investors closely watching the 100-day Simple Moving Average (SMA) for further direction. The metal has been facing selling pressure amid a stronger U.S. dollar and rising Treasury yields, limiting its near-term upside potential.
The recent pullback in silver coincides with a broader risk-off sentiment in financial markets. Expectations of prolonged higher interest rates from the Federal Reserve have bolstered the dollar, making non-yielding assets like silver less attractive. Traders are also weighing concerns about slowing global economic growth, which could dampen industrial demand for the metal.
Despite short-term weakness, some analysts view the 100-day SMA as a key technical support level that could determine silver’s next move. A decisive break below this threshold might trigger a deeper correction, while a rebound could reinvigorate bullish momentum. However, with market volatility persisting, traders remain cautious about making aggressive bets.
Silver US Dollars per Ounce 1-D Chart as of February 27, 2025 (Source: TradingView)
Broader macroeconomic factors continue to play a crucial role in shaping silver’s trajectory. Upcoming U.S. economic data, including inflation figures and employment reports, could influence the Federal Reserve’s rate outlook, thereby impacting the dollar and precious metals. Any signs of sticky inflation or labor market resilience may further weigh on silver’s appeal.
Meanwhile, geopolitical tensions and central bank demand for precious metals remain potential catalysts for price swings. Physical demand from major markets like China and India could provide some downside protection, but a stronger dollar environment is likely to keep gains in check.
As XAG/USD hovers near critical levels, market participants will be closely monitoring technical signals and macroeconomic developments. A break above $32.50 could revive bullish sentiment, while a sustained drop below the 100-day SMA might open the door to further downside in the near term.
